March 26, 2006
Enron Prosecution Nearly Complete as We Ponder the Chuckle-Giggle Distinction
Former Enron treasurer Ben Glisan is nearly done on the witness stand, and reports indicate that he will be the last significant former Enron employee to testify for the government. Prosecutors may complete their case this week. Glisan's cross-examination included a review of how former CEO Ken Lay reacted to a description of the effect of the Raptor off-balance sheet transaction on Enron's accounting. On direct examination, Glisan described Lay's reaction as a "giggle" because of the way in which it helped out the company's balance sheet. One of Lay's defense team, Bruce Collins, noted on cross-examination that he had heard Lay chuckle but never giggle, to which Glisan responded, "I will concede chuckle." Such are the heights (and depths) of cross-examination in a long trial that hinges on whether small facts can support an inference of intent to deceive and defraud.
If the government is indeed close to finishing its case-in-chief, then apparently it will not use Enron's former chief accounting officer, Richard Causey, who entered a guilty plea shortly before the trial commenced, as a witness. There is a chance that prosecutors are holding Causey in reserve for rebuttal, depending on what Lay and Jeffrey Skilling say if they testify, although that could be a risky proposition for the government. I would expect that both Lay and Skilling will testify -- Skilling is unlikely to put his defense in the hands of Lay, and vice-versa -- so the defense case will probably take at least two weeks, and possibly longer. This proceeding will be done by Memorial Day, won't it? A Houston Chronicle story (here) discusses Glisan's testimony.
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