Saturday, July 9, 2005
The evidentiary phase of the prosecution of five former executives of the Enron Broadband Services division on securities fraud and conspiracy charges is over after three often excruciating months. The last of the five defendants, Kevin Howard, the CFO of the unit, denied any involvement in a fraud, the same position as the other four defendants, and the government's rebuttal was mercifully short (less than one day). Interestingly, each defendant testified, and by taking a united front the group is likely to rise or fall together. As discussed in posts by Tom Kirkendall on the Houston's Clear Thinkers blog (here), the case did not go as well as the government hoped, with problems ranging from questions about which videotape was actually shown to analysts -- the heart of the government's claim that the defendants made misstatements regarding the unit's prospects -- to questions about the Enron Task Force's tactics in possibly trying to intimidate witnesses. Copying a failed tactic of prosecutors in the Richard Scrushy trial, Tom notes that a prosecutor appeared to violate the judge's order not to discuss a deferred prosecution agreement with a bank that did business with Enron, but the prosecutor did so anyway. The result was the same as in Scrushy's trial: the cross-examination was terminated.
Given the length of the trial and mind-numbing technical details presented in the government's case-in-chief, it will be interesting to see if the jury makes a quick determination based on an overall sense of the credibility of the witnesses without getting too heavily into the minutiae of the case. Houston Chronicle stories (here and here) discuss the defense resting and the government's rebuttal case. (ph)