March 28, 2006
Government Rests Its Case Against Lay and Skilling, and Asks for Four Counts to Be Dismissed
The government ended its case-in-chief against former Enron CEOs Ken Lay and Jeffrey Skilling after calling its final witness, Joanne Cortez, a former Enron employee who testified about how Lay used his line of credit from the company. After resting, the government requested that the court dismiss three of the securities fraud charges against Skilling and one charge of lying to auditors against Lay. According to the Houston Chronicle's trial blog (here), the prosecutor stated that "[w]e elected out of economy and some other reasons" to not introduce evidence on those charges. The government case stretched out over 8+ weeks, and I suspect it decided not to put on evidence on those charges because they concerned mostly conduct in early 2000, which is fairly well removed from the focus of the case on public statements made by Lay and Skilling -- and their stock trading -- in 2001, right up to the time Enron went into a tailspin.
Under Federal Rule of Criminal Procedure 48(a), the government is required to obtain the court's permission to dismiss charges during trial. After the government completed its case, U.S. District Judge Sim Lake granted the government's motion and directed that it produce a redrafted indictment with the dismissed counts removed. He also denied the defense's Rule 29 motion to dismiss the remaining charges due to insufficient evidence -- no great surprise there because such motions are granted only rarely. The trial will resume on Monday, April 3, with the defense putting on its case. Everyone will be preparing for the testimony of Lay and Skilling during the break, no doubt. The defense lists 113 possible witnesses, a number that should be cut down in much the way baseball teams have to pare their rosters at the end of spring training. Otherwise, see you at the Fourth of July picnic. (ph)
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